By APA Bureau:
Buoyed by its increasing aftermarket penetration and expanding client base in the OE segment, the French automotive tyre major Michelin is doubling the production capacity of its Indian facility near Chennai. Work has been progressing and the company that produces 15,000 tonnes of tyres a year now will produce 30,000 tonnes a year, by the end of 2018.
In India Michelin sells most of its truck and bus radial tyres in the replacement market. It has a strong presence in the military segment. In areas like personal troop carriers and some other segments it has 100 percent market share.
The company sells its tyres through over 5,000 outlets spread across more than 150 locations in the country. The company has a strong OEM presence in the bus segment. It has a full share in the inter-city coach segment and supplies its tyres to buses of Volvo, Scania and MAN, among others.
At present, only 70 per cent of its products sold in India are produced in its Chennai facility. In two years it plans to produce 100 per cent of its domestic market requirements. Alongside, the company hopes to increase its footprint in the aftermarket.
As part of its OE expansion programme, the company has signed a commercial agreement with Ashok Leyland to supply Michelin X Guard range of radial truck tyres for its Captain 3718 Plus range of trucks. Hitherto, the company was catering to Volvo as OE supplier.
The new generation range of radial truck and bus tyres, offering up to 10 percent fuel savings, are exclusively designed, engineered and made for India. It will benefit the vehicle maker in terms of increased fuel economy, eventually enhancing its edge over competition. It is expected to enable the OEM to pass benefits of fuel efficiency and optimized payload to its customers.
Targeted at the price-sensitive general goods carriers and medium and long- haul transporters, Michelin X Guard is a longer-lasting, fuel efficient, lighter and robust tyre. The latest material solutions and 3D printing technologies have been used to produce the tyre moulds. As a result, ‘Regenion’ technology, which regenerates new grooves as the tyre wears, is integrated. It helps to retain excellent grip right up to the very last mile.
The performance of this tyre benefits also from another technology called ‘InfiniCoil’ – a several hundred-metre long thin wire wrapped round the tyre structure giving it added robustness without extra weight. These technologies have enabled the 125-year old company to produce a tyre that is 18 percent lighter, yet delivers on robustness and returns better performance on tyre mileage and fuel efficiency. With this new tyre, Michelin is making an entry in the mass market segment of commercial vehicle tyres in India.
According to the company, fuel tests are conducted under Michelin and Society of Automotive Engineers (SAE)-recommended methodology and conditions against leading brands of similar size and pattern. Fuel savings are based on an assumption of 7,000 km of travel per month in a 10 X 2 vehicle with diesel prices at INR 55 per litre.
As part of the expansion programme, the company has inaugurated a new state-of-the-art production line for the X Guard range of tyres at its Chennai plant. The new production line will help augment doubling of the capacity of the plant by 2018.
The CEO of Michelin Group, Jean Dominique Senard, said, “Until now we have been strong in specialised tyres such as military and coaches. Now the market is maturing with BS-IV and with BS-IV norms coming in, technology is coming into play and so opportunities for companies like us to get into the OE segment. Michelin is here for the long-term and we believe in the Indian growth story. I believe there is a tremendous potential for mobility in the country.” He further said that the global company has so far invested Rs 3,500 crore in creating the facility in India and also in a R&D centre to serve not just India but also global requirements.
“India is a priority market for us and growing demand for our products in the country reaffirms our commitment to keep innovating for our customers here. In a very short time, our Chennai plant has evolved to become one of our most advanced manufacturing facilities globally. The purpose of this plant was to cater to the needs of the Indian market and I am happy to see that we are on target in this journey. The Michelin XGuard was conceived to address the Indian market’s need for a tyre that is fuel efficient, safe and lasts longer and to this end we adapted the very best of Michelin technologies to produce a premium tyre at an affordable price.”
“When it comes to India of course there have been some bumps but globally if you look at the trend there has been a massive growth probably much larger than we had in other areas of the world,” he said.
The Chennai facility of the French major also feeds some of the requirements of the export market in countries of the Middle East and Europe.
Currently it exports 10-20 percent of the total monthly produce of the plant. After the capacity expansion the company aims at catering to all the domestic requirement from this factory.
The company also has a R&D facility to design for India and build for India because of the specific type of demand that the country has with the talent available at its facility. In India, it has products in all segments of vehicles ranging from bicycles, two-wheelers, and passenger cars to commercial vehicles. The company which outsources two-wheeler tyres from TVS Tyres said its growth has been strong with a 50-60 percent CAGR.
“We are committed to the partnership and we will continue to grow with our partners,” Michelin India’s, Executive VP and Member of the Board, Mohan Kumar, said. At present the company imports passenger car tyres and other special needs tyres while it makes all the truck tyres in India.
Headquartered in Clermont-Ferrand, France, Michelin is present in 170 countries, has 111,700 employees and operates 68 production facilities in 17 countries which together produced 184 million tyres in 2015.